Thirteen men were convicted of smuggling metal raw materials across the closed China-North Korea border, according to a ruling by the Jiangsu Yangcheng Intermediate Court on Wednesday March 31, resulting from the lawsuit (2021) Jiangsu 09 Criminal case Final No51. The men were handed jail sentences ranging from one to six years.
Jiangxi Copper subsidiary Shandong Humon was listed as the buyer of two gold concentrates cargoes of 850 tonnes and 1,000 tonnes in April 2019.
Yuguang Gold & Lead subsidiary Henan Yuguang Zinc Industry and major lead producer Henan Jinli Gold & Lead were listed in the court ruling as buyers of North Korean zinc and lead concentrates in June 2019.
A North Korean vessel named Jungang6 (IMO number 9055618) was found by the police to be unloading zinc concentrates at a port in Binhai county, Jiangsu province, in July 2019.
The 1,116.68 tonnes of zinc concentrates that was seized was then sold at an auction by Chinese police at a price of 3.97 million yuan (US$ 608,662).
Henan Yuguang Zinc Industry, which runs a 250,000 tonne-per-year zinc smelter, claims on its website to be the third-largest refined zinc producer in China.
Henan Jinli Gold & Lead has an annual production capacity of 350,000 tonnes of lead and 50,000 tonnes of zinc bypoxide. Shandong Humon is one of the biggest gold producers in China with a capacity to process 50 tonnes per year.
“Raw materials such as concentrates and ores look very similar, so it is difficult to tell the origin. Every year, many materials are needed to feed furnaces, [so] can anyone be sure all the feed is legitimate?” one metal concentrate trader source told Fastmarkets.
Metal raw materials from North Korea can still be bought in China at a discount to the market price of legitimate materials, the trader source added, with deals sometimes done in the form of a barter exchange for other goods to avoid monetary transfers.
Since August 2017, China has followed the United Nations’ resolution banning exports from North Korea to choke off the country’s access to funds to develop its nuclear missiles program.
Prior to the sanctions, North Korea supplied about one-tenth of China’s lead concentrate imports.
Shandong Humon, Yuguang Zinc Industry and Henan Jinli Gold & Lead did not respond to Fastmarkets’ requests for comment.
